Ladies and Gentlemen,
Dear Friends,
Guten morgen.
For almost 25 years, the German Council for Sustainable Development has helped society look to the future – towards a healthier, more prosperous and more resilient world.
Today, in the face of worsening climate change, escalating conflict, and persistent trade wars, this work is more important than ever.
So I am delighted to join you today to discuss how freedom, democracy and sustainable economic practices can strengthen our competitiveness.
This is not an academic debate.
When China imposed certain export restrictions last month, our businesses experienced very practically how excessive dependency on apparently cheap primary resources threatens the very fundamentals of our European industrial model.
So I want to be very concrete in my remarks, and take the example of the circular economy to examine how sustainable economic practices can help Europe to become more competitive.
In September, at the World Expo in Osaka, I had a conversation about the ancient Japanese art of Kintsugi – where broken pottery is repaired using gold or silver to fill in the cracks.
The repaired pottery becomes more beautiful and valuable than the original – and this philosophy resonates strongly with me.
That discussion, and the market protection measures were experiencing today, have helped to crystallise some ideas for me.
First – our world is changing rapidly. So our policies must change too. We must become faster and more agile.
Our businesses are faced with high energy costs, uncertain global supply chains and unfair global competition.
Our ecosystems are struggling, and our water cycle is broken.
In this unstable world, moving to a circular economy is no longer simply an environmental choice.
It has become an economic necessity.
Second – Circularity is a massive opportunity – for our competitiveness, our environment, and our long-term future.
For businesses, a circular model can:
- cut costs,
- open new revenue streams,
- reduce dependency on virgin resources,
- enhance brand reputation, and
- boost resilience.
And we, as citizens, hold some of the keys to a circular model in our hands. Literally.
According to one estimate, there are ten billion dormant phones worldwide.
The e-products we through away every year include about 1 million tons of critical raw materials.
But we recycle only about 1% of the rare earths we use. On Neodymium, for example, a key material for permanent magnets, essentially none of the 1700 tonnes generated in 2022 were recovered.
And it is not just about critical raw materials.
Construction materials as basic as the sand out of which we make our cement are starting to be short of supply. But did you know that only one percent of materials from building demolitions are reused?
And every time I buy a new shirt for my granddaughter, I remember that only one percent of used clothes are recycled into new clothes.
For decades, we have measured progress through linear growth -- based on an economic model that extracts, makes, uses, and discards products over and over again.
Piles of waste grow in landfills or are shipped abroad – out of sight and out of mind.
And we are using natural resources nearly twice as fast as ecosystems can regenerate them.
We need a smarter model for the 21st century.
One that maximises value and minimises waste.
One that reuses and recycles materials and keeps them in the economy for as long as possible.
And one that reduces our dependencies on other countries and on vulnerable supply chains.
The circular economy is Europes best chance to stay competitive in a world of scarce raw materials and expensive energy.
And it is based on the recognition that economic strength and environmental responsibility are two sides of the same coin.
A decade ago, Europe was strongly dependent on Russia for our energy. With RePowerEU we managed to turn this around, and decarbonised energy is a big part of it.
Today, virtually all our rare earth minerals come from China. With decisive action, we can turn this around, and circularity must be a big part of our plan.
To get results we need to go faster and further.
But I am hopeful, because I see growing momentum behind the transition to circularity:
Not only in conversations with political leaders across Europe and around the world.
Citizens are demanding more sustainable products. They understand that to uphold our values and our freedom Europe needs to reduce our dependencies. And they are willing to play their role, starting with recycling the smartphone we hold in our hands.
For many companies around Europe, the circular model is already becoming a driver of innovation, resilience and industrial renewal.
For example:
In just a few weeks I will visit Krefeld for the opening of Germanys first lithium recycling plant.
Traceless – from Hamburg – is creating entirely compostable packaging without plastic.
And established companies are finding new ways of reusing materials and repairing products.
Scania – a Swedish company that is part of the Volkswagen Group – is putting old, remanufactured gearboxes in new trucks. In doing so, they use 50 percent less material and cut carbon emissions by up to 45 percent.
BMW is pioneering a closed-loop system for electric vehicle batteries in Bavaria.
Meanwhile, Mercedes-Benz has opened a battery recycling plant – the first of its kind in Europe – capable of recovering more than 90 percent of valuable elements.
Business leaders must not hesitate in their circularity objectives. There is a cost to excessive dependencies on primary raw material imports. So circularity is becoming increasingly commercially viable.
And the message I am sending today is that Europe will do what it can to support this.
We are preparing a Circular Economy Act to speed up the circular transition across Europe.
First – We need to build a true single market for secondary raw materials – boosting both supply and demand.
Instead of having 27 Member States recycle different products in different ways – we should aim to build one market, with one set of rules, leading to exponential opportunities.
By ensuring the free movement of secondary raw materials, we can turn waste into valuable materials for businesses across the EU.
Second – we need to get the economics right.
We have to ask why, for example, primary plastics are still cheaper than secondary ones.
How can we build investor and industry confidence in demand for recycled plastics?
And what role can public procurement play?
Third – we have to act decisively.
The Act will come next year. But Europe cannot wait.
So already today, the EU supports investment in circularity where it can. An exciting Horizon Europe project led by the Fraunhofer Institute is developing Hubs for Circularity, where waste, energy, water and materials are shared among partners.
Before the end of this year, we will adopt a package of short-term measures to take first steps towards deepening the single market for secondary raw materials, boost circular investment, and ensure a level playing field, including through trade measures when justified.
And circularity will play a big role in the Resource EU package we will adopt in the coming weeks to accelerate reducing our dependencies when it comes to critical raw materials.
Ladies and gentlemen,
My examples and stories show that sustainability and competitiveness are not a trade-off.
They highlight the great potential of circularity – and what we can achieve with leadership and vision.
But I am also frustrated. Because these examples remind me of that 12 percent circularity rate in Europe – and how much more we need to do.
So let me finish with a call to action.
Europes challenges of today requires a whole-of-society commitment.
We need:
- Companies to factor in the costs of dependencies and commit to resilience planning and truly circular models.
- Citizens to use their voice, consumer habits and purchasing power to support sustainable, circular practices.
- And national and regional authorities to set the right framework.
I am looking forward now to discuss with you!
